The main purpose of preparing a Trial Balance is: MCQ with Answer and Explanation

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The main purpose of preparing a Trial Balance is:

A. To know the financial position

B. To prepare final accounts

C. To detect frauds

D. To check the arithmetical accuracy of ledger accounts

Answer: Option D

Solution (By JKSSB Mock Tests)

Trial balance ensures that total debits equal total credits, verifying posting and balancing accuracy.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

The 'Deferred Tax' on account of timing differences is calculated using:

A. Enacted tax rates that will apply in the periods when the differences reverse

B. Minimum Alternate Tax rate

C. Current year tax rate

D. Average tax rate

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Correct Answer: Option A

Explanation:
Deferred tax is measured using tax rates that have been enacted or substantively enacted by the reporting date.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

The 'Sabka Vishwas' scheme was related to:

A. GST only

B. Customs only

C. Income tax

D. Indirect tax legacy disputes

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Correct Answer: Option D

Explanation:
Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 covered service tax and excise disputes.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3

The 'Price Earning' (P/E) ratio is calculated as:

A. Earnings per share / Market price per share

B. Market price per share / Earnings per share

C. Dividend / Market price

D. Market price / Book value

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Correct Answer: Option B

Explanation:
P/E ratio indicates how much investors are willing to pay per rupee of earnings.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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